This study examines the reduction in medical care utilization after mental health treatment, also known as the offset effect. With data from a computerized ambulatory care information system, an episode-of-care method is used to characterize the mental health care received by patients in a prepaid group practice. The characteristics of the psychiatric episodes, such as duration, type of therapy, and number of visits, are examined in relation to the degree of offset effects among psychiatric patients. The results indicate that offset effects are most pronounced for a variety of characteristics related to the psychiatric episode of care including brief, high-intensity therapy, treatment for transient rather than chronic mental illness, and individual rather than group therapies. Finally, this study replicates two major findings in the offset literature: the characteristic peaking of medical use before mental health care and the shortterm nature of the offset effect.
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